Tag Archives: Dissents

New opinion — “Because his allegations against the beauty-products corporation are more than skin-deep, we reverse.”

Trzaska v. L’Oreal USA — employment — reversal — Ambro

The Third Circuit today ruled in favor of an in-house attorney who alleged that he was fired by L’Oreal for refusing to meet a corporate quota for patent applications (?) by filing applications for unpatentable products. The witty quote that forms the title of this post is from the opinion.

Ambro was joined by Fuentes; Chagares dissented. Arguing counsel were Harold Goodman of Raynes McCarty for the attorney and Christopher Carton of K&L Gates and Eric Savage of New York for L’Oreal.

New opinions — Third Circuit recognizes right to film police in public

Fields v. City of Philadelphia — civil rights — reversal — Ambro

In a landmark free-speech ruling, the Third Circuit today held that individuals have a First Amendment right to film police activity in public. A panel majority further held that the officers who did the filming here were entitled to qualified immunity from suit because the right had not been sufficiently clearly established; Judge Nygaard dissented on this ground. The court remanded for the district court to decide whether the city was subject to municipal liability.

Joining Ambro was Restrepo; Nygaard joined in part and dissented in part. Arguing counsel were Molly Tack-Hooper of ACLU-PA for the plaintiffs and Craig Gottlieb of the Philadelphia city Law Department for the defendants. A host of top-flight appellate lawyers were on the briefs on the ACLU’s side, including Jonathan Feinberg of Kairys Rudovsky, Alicia Hickok of Drinker Biddle, and Ilya Shapiro of Cato Institute.

Early commentary by Eugene Volokh at Volokh Conspiracy here and by Mark Joseph Stern at Slate here.

US v. Stimler* — criminal — affirmance — Roth

The Third Circuit affirmed the convictions of three Orthodox Jewish rabbis who were convicted of conspiracy to commit kidnapping for their role in “a scheme through which they … sought to assist Orthodox Jewish women to obtain divorces from recalcitrant husbands.”  The court rejected 8 different challenges to the convictions; Judge Restrepo wrote separately to disagree with the panel majority’s conclusion that investigators’ warrantless use of cell site location information did not violate the Fourth Amendment, but would have affirmed anyway under the good-faith exception.

Joining Roth was Chagares; Restrepo concurred in the judgment in part. Arguing counsel were Nathan Lewin of Washington DC for one defendant, Aidan O’Connor of Pashman Stein for the second, and Peter Goldberger for the third. Arguing for the government were Norman Gross and Glenn Moramarco of the NJ US Attorney’s office.

Early news coverage here and here.

UPDATE: on July 17 the court issued an order stating that the government “has advised of factual errors contained within the opinion” and that in light of the letter the Court will issue an amended opinion. It states that the amendment does not alter the judgment.

*The link at the top of this entry now goes to the amended opinion issued July 17. The original, withdrawn opinion is here.

Three new opinions [updated]

US v. Jackson — criminal — reversal — Cowen

The government appealed from the criminal sentences imposed on a husband and wife for abusing their foster children. A divided Third Circuit reversed for resentencing on a host of grounds.

The 82-page majority opinion noted:

This case implicates a number of rather unusual sentencing issues. This is not surprising because Defendants were not convicted and sentenced for committing enumerated federal crimes of the sort that federal courts consider on a regular basis. Instead, they were convicted and sentenced in federal court for state law offenses “assimilated” into federal law pursuant to a federal statute, the ACA.

The panel majority held that the district court erred in concluding that the federal sentencing guideline for assault was not sufficiently analogous to use to calculate the defendants’ guideline range. The district court also erred in refusing to make sentencing-related findings of fact beyond the findings found by the jury at trial. And it erred some more by “focusing on state sentencing principles to the exclusion of basic federal sentencing principles.” Judge McKee dissented, mainly to disagree with the majority on the analogous-guideline point.

Finally, Judge Cowen’s majority opinion concluded that “we do conclude” that the sentences were substantively unreasonable. But a footnote in the majority opinion stated that Judge Fuentes “would vacate” on the preceding procedural grounds “without reaching” substantive unreasonableness. (A footnote in Judge McKee’s dissent states that he refrains from reaching the issue.) So is there a precedential holding on substantive unreasonableness? It’s possible to argue either way, and I expect future litigants will do exactly that. I think the substantive reasonableness section probably is precedential, but the opinion’s failure to be clear on that point is strange.

Joining Cowen was Fuentes; McKee dissented with some harsh language for the government. Arguing counsel were John Romano of the NJ US Attorney’s office for the government, Herbert Waldman of Javerbaum Wurgaft for the wife, and Louise Arkel of the NJ federal defender for the husband.

 

Knick v. Township — civil — affirmance — Smith

A Pennsylvania township enacted an ordinance that authorizes officials to enter any property to “for the purpose of determining the existence of and location of any cemetery” and compels private cemeteries to open themselves to the public during daylight hours.

The Third Circuit described the ordinance as “extraordinary and constitutionally suspect,” noting “it is difficult to imagine a broader authorization to conduct searches of privately owned property” and urging the township to abandon it. But the court affirmed dismissal of a suit challenging the ordinance, holding that the the plaintiff lacked standing to raise a facial Fourth Amendment challenge because her rights were not violated and that her Fifth Amendment takings claim is not ripe because she had not first sought compensation under the state’s inverse-condemnation procedure. (Embarrassingly, the court noted that the standing issue had not been raised by the township, and that it did raise a “curious” argument that the plaintiff failed to satisfy Monell because she failed show show a cognizable injury.) The opinion helpfully clarifies the different burdens for facial and as-applied challenges and distinguishes facial takings from facial challenges.

Smith was joined by McKee and Rendell. Arguing counsel were J. David Breemer of the Pacific Legal Foundation for the plaintiff and Thomas Specht of Marshall Dennehey for the township defendants.

 

Taha v. County — class action — affirmance — Greenberg

The Third Circuit affirmed an order granting class action certification in a suit against defendants who created a web page that made available information about over 60,000 people who had been held at a county jail, including persons whose records were expunged. The defendants had argued that the court erred in deciding certification after ruling on a motion for partial summary judgment, but the court held that this challenge was waived because it was not raised below. The defendants also argued that the court erred in certifying a punitive damages class on several grounds, including standing and predominance, but the court disagreed.

Joining Greenberg were Greenaway and Shwartz. Arguing counsel were Burt Rublin of Ballard Spahr for the county defendants and Robert LaRocca of Kohn Swift for the plaintiffs.

Three new opinions

De Ritis v. McGarrigle — civil rights — reversal — Krause

The Third Circuit today emphatically rejected a former public defender’s claim that his First Amendment rights were violated when he told others that he had been transferred because he took too many cases to trial. The court reversed the district court’s denial of summary judgment based on qualified immunity. Among the court’s holdings was that an attorney’s idle chatter with other lawyers in court during breaks between proceedings is protected by the First Amendment.

Krause was joined by Vanaskie and Nygaard. Arguing counsel were De Ritis pro se and Mark Raith of Holsten & Associates for the public defender.

 

Halley v. Honeywell Int’l — class action — affirmance in part — Scirica

The Third Circuit upheld approval of a $10 million class action settlement of a large chemical pollution suit. The court rejected several challenges to the settlement, including various arguments that the court lacked a sufficient factual record for approval. The court also upheld the $2.5 million attorneys’ fees award, but remanded for reconsideration of the award of costs because the lower court failed to adequately explain its reasoning.

Joining Scirica were Ambro and Vanaskie. Arguing counsel were Thomas Paciorkowski of Jersey City for the objector and Anthony Roisman of Vermont for the appellees.

 

Duquesne Light Holdings v. C.I.R. — tax — affirmance — Ambro

A divided Third Circuit panel today affirmed a tax-court ruling applying the Ilfeld doctrine that, absent clear Congressional intent, the tax code should not be interpreted to give taxpayers the equivalent of a double deduction. The tax-liability dispute here is, to my inexpert eye, arcane.

Joining Ambro was Krause; Hardiman dissented. Arguing counse were appellate powerhouse James Martin of Reed Smith for the taxpayer and Arthur Catterall for the government.

New opinions — two civil affirmances

Jones v. Does — civil / arbitration — affirmance — Fuentes

Today the Third Circuit ruled against an employer who argued that an overtime-pay suit against it should have submitted to arbitration. The employees sued the employer under the Fair Labor Standards Act. The employer moved to stay or dismiss pending arbitration, arguing that disputes over interpretation of the collective-bargaining agreement had to be arbitrated, but the district court disagreed and a divided Third Circuit panel affirmed.

Joiing Fuentes was Chagares; Ambro dissented. Arguing counsel were Stuart Weinberger of Goldberg & Weinberger for the employer and Matthew Miller of Swartz Swidler for the employees.

 

Petras v. Simparel — civil / qui tam — affirmance — McKee

The Third Circuit today affirmed dismissal of a suit under the False Claims Act. Addressing an issue of first impression, the court held that the Small Business Administration was not acting as the government for FCA purposes when it was merely a receiver for a private company. The court also relied on legislative history to rule that certain contingent obligations fell outside the FCA’s scope.

Joining McKee were Hardiman and Rendell. The case was decided without oral argument.

 

New opinions — a partial sentencing reversal and an odd dual-juries affirmance

US v. Douglas — criminal sentencing — partial reversal — Shwartz

The Third Circuit today held that a district court erred when it imposed an obstruction-of-justice enhancement to a defendant’s criminal sentence. The enhancement was imposed because the defendant missed his original trial date due to an emergency room visit, but this was error because the government did not prove that the failure to appear was willful.

Over Judge Greenaway’s dissent, the court rejected the defendant’s claim that the court also erred by imposing a sentencing enhancement for abuse of a position of trust. The majority held that being a non-supervisor airline mechanic with a security clearance qualified for the enhancement.

Judge Greenaway’s dissent began:

The Sentencing Guidelines are meant to constrain judicial discretion, focusing and channeling decisions about criminal punishment in order to provide consistent,disciplined conclusions. I fear that my colleagues have shed those constraints. By disregarding the binding source of law here—the Sentencing Guidelines themselves—the majority has left the abuse of a position of public trust enhancement without limits on its scope. The Guidelines, and our consistent precedent in applying them, delineate particular sorts of abuse of trust which trigger this enhancement. The majority’s interpretation sweeps those textual and precedential distinctions away, rendering the enhancement indiscriminately applicable to a panoply of criminal actors.
Joining Shwartz was Vanaskie in full and Greenaway in part. Arguing counsel were Arnold Bernard, Jr. of Pittsburgh for the defendant and Michael Ivory for the government. The case was argued last March.

 

US v. Brown — criminal — affirmance — Jordan

The Third Circuit held that a district court did not commit plain error when it empaneled separate juries, one for this defendant and one for his co-defendant, for the same trial. The court noted that dual-jury trials “seem[] to have very little precedent in this Circuit,” and “we do not mean by this ruling to encourage the practice.”

Brown also urged the court to reconsider its 2014 en banc holding that defendants must object to procedural errors at sentencing to avoid plain error review. Problem was, he didn’t actually assert any errors with his sentence!

Joining Jordan were Chagares and Hardiman. The case was decided without oral argument.

New opinions — Court affirms Facebook-threats conviction again

US v. Elonis — criminal — affirmance — Scirica

Last year, the Supreme Court reversed the Third Circuit’s affirmance of Anthony Elonis’s conviction for making threats on Facebook. On remand, the court today affirmed again, holding that the error was harmless because the jury would have convicted him if it had been properly instructed.

Joining Scirica were McKee and Hardiman. Arguing counsel were Abraham Rein of Post & Schell for Elonis and Mark Levy for the government.

 

In re: Grand Jury Matter #3 — criminal / jurisdictional — dismissal — McKee

A divided Third Circuit panel today held that it lacked jurisdiction to hear an appeal from an order allowing the prosecution to show a grand jury privileged emails because, while the appeal was pending, the grand jury indicted the appellant.

Joining McKee was Scirica; Ambro dissented. Arguing counsel were Scott Resnik of New York for the appellant and Mark Dubnoff for the government.

New opinion — court rules for prisoner in speech-retaliation appeal

Mack v. Warden, Loretto FCI — prisoner civil rights — reversal — Fuentes

A divided Third Circuit panel ruled in favor on an inmate alleging violation of his rights. As the majority opinion summarized:

Mack’s allegations raise several issues of first impression in our Circuit, including (1) whether an inmate’s oral grievance to prison officials can constitute protected activity under the Constitution; (2) whether RFRA prohibits individual conduct that substantially burdens religious exercise; and (3) whether RFRA provides for monetary relief from an official sued in his individual capacity. We answer all three questions in the affirmative, and therefore conclude that Mack has sufficiently pled a First Amendment retaliation claim and a RFRA claim. We agree, however, that Mack’s First Amendment Free Exercise claim and Fifth Amendment equal protection claim must be dismissed. We will therefore affirm in part, vacate in part, and remand to the District Court for further proceedings.

Fuentes was joined by McKee; Roth dissented in part, arguing that inmates’ oral complaints should not be First-Amendment-protected speech. Arguing for the prisoner was Duke law appellate clinic student Russell Taylor (supervised by Sean Andrussier), and for the government was Jane Dattilo.

New opinions — a wiretap-suit-standing shocker and a qui tam reversal [updated]

Schuchardt v. President of the U.S. — civil — reversal — Hardiman

Today the Third Circuit ruled in favor of a solo civil practitioner named Elliott Schurchardt appearing pro se and appealing the denial of a pro se suit he brought against the government on behalf himself and others similarly situated. The pro se filer alleged that the NSA’s electronic monitoring violates the Fourth Amendment. The district court dismissed his suit on standing grounds, but the Third Circuit held that the pro se filer’s allegations were sufficient to survive dismissal on standing grounds, even though he alleged that the harm here resulted from collection of “all or substantially all of the email sent by American citizens by means of several large internet service providers.”

I’m going to go way out on a limb and predict a government rehearing petition and/or cert petition.

Joining Hardiman were Smith and Nygaard. Arguing counsel were Schuchardt (his address in the caption is in Virginia, his website lists Tennessee, and 2015 news coverage says Pittsburgh) pro se, and Henry Whitaker of the DOJ appellate section for the government.

UPDATE: seemingly intent on snatching defeat from the jaws of victory, the miraculously prevailing appellant already has been quoted in this news story as follows:

The appellate court ruling, however, limits his ability to subpoena evidence and depose witnesses, apparently exempting anything with a national security classification.

“If that’s the case, I’m not sure how much further the case can go because obviously, this entire area is classified,” said Schuchardt, who is considering an appeal to the Supreme Court on that part of the decision.

Sigh.

U.S. ex rel. Customs Fraud v. Victaulic — civil / qui tam — reversal — Roth

A divided Third Circuit panel today ruled that a district court erred in denying on futility grounds a qui tam relator’s motion for leave to amend its complaint. This appeal arises from the same amazing sitting I wrote about a couple weeks ago, the tenth published opinion from that panel.

Joining Roth was Krause; Fuentes dissented with vigor, arguing, “Whereas Twombly and Iqbal require plausible allegations of wrongdoing, CFI gives us unsupported assumptions and numerical guesswork.” Arguing counsel were Jonathan Tycko of D.C. for the appellant, Henry Whitaker (same one) for the government as amicus appellant, and Thomas Hill of D.C. for the appellee.

 

 

New opinion — Third Circuit reverses in hard-fought Avaya appeal

Avaya v. Telecom Labs — civil / antitrust — reversal — Jordan

In an appeal that pitted a former Solicitor General against a former president of the American Academy of Appellate Lawyers, a divided Third Circuit today held that a district court erred by granting a mid-trial motion for judgment as a matter of law in this gigantic antitrust and civil suit. The majority slip opinion runs 118 pages. The dissent, another 15 pages, argues in part that the majority should not reverse based on an argument first made in the reply brief.

Jordan was joined by Greenaway; Hardiman dissented. Superstar arguing counsel were Seth Waxman for the appellant and James Martin for the appellees. (Argument audio here.)

New opinions — affirming class certification and re-issuing an immigration opinion

Williams v. Jani-King of Philadelphia — civil / class action — affirmance — Fisher

The Third Circuit today affirmed a ruling certifying a class in a suit brought by two franchisees who allege that they are employees not independent contractors and thus are entitled to state-law wage protections. The class defendants argued that certification was error because the claims were not fit for class resolution, an issue implicating both commonality and predominance. The panel majority rejected this argument, emphasizing that an interlocutory challenge to certification is not the place to decide the merits. Judge Cowen dissented on commonality grounds, arguing that the majority opinion threatens the viability of franchising.

Joining Fisher was Chagares; Cowen dissented. Arguing counsel were Aaron Vanoort of Minnesota for the class defendants and Shannon Liss-Riordan of Massachusetts for the class plaintiffs.

UPDATE: commentary on JDSupra agreeing with the dissent here.

 

Ordonez-Tevalan v. A.G. — immigration — affirmance –Greenberg

The Third Circuit today granted panel rehearing and issued a new panel opinion in Ordonez-Tevelan v. A.G. The prior opinion is here, my summary is here. The disposition is unchanged, and my quick comparison of the two cases failed to reveal to me what changed. If an eagle-eyed reader alerts me I’ll update this post.

 

 

New opinion — split panel upholds dismissal of suit against officer who confronted and killed man high on PCP

Johnson v. City of Philadelphia — civil rights — affirmance — Fuentes

A lone police office responding to a radio call arrived on the scene to find a man “standing in the street, naked, high on PCP, and yelling and flailing his arms.” Police department policy directed the officer on what to do: “DEESCELAT[E] THE INCIDENT” by waiting for back-up, attempting to de-escalate through conversation, and retreating instead of using force. But, instead, the officer ordered the man to approach him. A confrontation ensued, the man reached for the officer’s gun, and the officer tasered the man and then used his gun to kill him. The man’s estate sued the officer and the city for excessive force.

Today, a divided Third Circuit panel affirmed dismissal of the man’s suit. The majority left open the possibility that an officer’s reckless initiation of an encounter could form the basis for an excessive-force claim, and also that the officer’s violation of department policy may be used to assess the reasonableness of a seizure. But the majority upheld dismissal of the suit on proximate-cause grounds, holding that there was no evidence from which a reasonable jury could find the requisite nexus between the officer’s act and the resulting death.

Judge Roth (notably, the only judge on the panel nominated by a Republican president) dissented, arguing, “By knowingly violating a police department regulation designed to keep mentally disturbed individuals safe, Dempsey set into motion the confrontation that ultimately led to Newsuan’s death – a confrontation whose foreseeability was the impetus for the establishment of Directive 136.”

Fuentes was joined by Krause, with Roth dissenting. Arguing counsel were Armando Pandola Jr. of Abramson & Denenberg for the estate and Craig Gottlieb of the city law department for the city.

New opinions — is the Third Circuit raising the bar for class certification again?

In re: Modafinil Antitrust Litig. — civil / class action — reversal — Smith

Today a divided Third Circuit panel vacated a district court order certifying a class in a pharmaceutical antitrust suit, announcing a new framework for analyzing the size of the class (“numerosity”). The majority directed that the numerosity inquiry “should be particularly rigorous when the putative class consists of fewer than forty members.” It ruled that the district court erred by placing too much weight on the late stage of the proceeding, directing that on remand the court should not take into account the sunk costs of litigation nor the risk of delay if certification were denied. The majority also held that the district court failed to “fully” explore whether class members could just join instead. The panel unanimously rejected the class defendants’ predominance arguments.

Judge Rendell dissented vigorously from the majority’s numerosity analysis, beginning thus:

Today, the Majority concludes that the able District Court judge abused his discretion by purportedly focusing on a consideration that we have never—indeed, by my research, no court has ever—stated it should not consider. How can that be? Furthermore, how can it be that the Majority mischaracterizes the late stage of the proceedings as being the focus of Judge Goldberg’s ruling when his reasoning actually focuses on the considerations that our case law dictates it should? Also how can it be that in analyzing judicial economy district courts are prohibited from considering the stage of the proceedings? I am perplexed. I am similarly perplexed as to why the Majority is directing the District Court on remand to figure out whether joinder is practicable when the appellants have failed to make that case themselves. I therefore respectfully dissent from part III.A of the Majority’s opinion.

This was Rendell’s second major dissent in two weeks.

Joining Smith was Jordan, with Rendell dissenting in part. Arguing counsel were Bruce Gerstein of Garwin Gerstein for the appellees, and Rowan Wilson of Cravath Swaine and Douglas Baldridge of Venable for the appellants.

UPDATE: news coverage on PennRecord.com, describing the court’s ruling as “surprising,” here.

 

Carpenters Health & Welfare Fund v. Management Resource Sys. — civil / labor — reversal — McKee

The Third Circuit today reversed a district court order dismissing a suit challenging a company’s failure to make contributions to employee funds.

Joining McKee were Fisher and Greenaway. Arguing counsel were Stephen Holroyd of Jennings Sigmond for the appellants and Walter Zimolong III for the appellees.

 

In re: Asbestos Pros. Liab. Litig. — civil — reversal in part — Scirica

In 1999, the Supreme Court described asbestos litigation as “elephantine.” Over a decade and a half later, the elephant is still lumbering along.

A worker exposed to asbestos died of lung cancer, and his estate sued the corporation whose equipment contained the asbestos he had been exposed to. In a fact-bound ruling applying Indiana law, the Third Circuit today affirmed dismissal of claims related to some of the equipment but reversed dismissal of claims related to other equipment.

Joining Scirica were McKee and Ambro. Arguing counsel were Robert McVoy from Illinois and Christopher Conley from Georgia.

New opinion — divided panel rejects waiver argument and orders arbitration

Chassen v. Fidelity Nat’l Financial — civil / arbitration — affirmance — Smith

A divided Third Circuit panel today ruled in favor of a civil defendant seeking to compel individual arbitration (that is, non-class arbitration; the opinion refers to it as bipolar arbitration). The court held that the defendant did not waive its arbitration-clause defense — even though it did not raise the defense in two and a half years of expensive litigation below, and even though it could have but did not raise the arbitration defense to obtain class arbitration the whole time — because an effort to compel individual arbitration would have been futile under then-existing law. The majority ruled that the factors it previously had announced for deciding when a party waived an arbitration defense did not control when the sole reason for the delay in asserting the defense is futility.

Judge Rendell — who, as I’ve observed, has been a major force in the court’s recent en banc litigation — dissented. Her opinion began:

The majority’s opinion is flawed for a clear and obvious reason: it relies on caselaw that has no application here. Therefore, I must respectfully dissent.

In Muhammad v. County Bank of Rehoboth Beach, the New Jersey Supreme Court held that “the presence of the class-arbitration waiver in Muhammad’s consumer arbitration agreement render[ed] that agreement unconscionable.” 912 A.2d 88, 100 (N.J. 2006). Yet, despite the lack of a class arbitration waiver in the arbitration clauses here, the majority holds that a New Jersey court in 2009, at the outset of this case, would have found Muhammad controlling here. I reject that view, and urge you to read Muhammad and the actual arbitration clauses at issue here. Doing so will lead inexorably to one conclusion: this case is not Muhammad, and a motion by the Defendants in 2009 to compel arbitration thus would have been anything but futile. Moreover, the majority has expanded the concept of futility beyond what we as a court should recognize.

Seems like a good bet for a petition for en banc rehearing.

Joining Smith was Roth, with Rendell dissenting. Arguing counsel were Michael Quirk of William Cuker for the appellants and Michael O’Donnell of Riker Danzig for the defendant.

 

New opinions — Bridgegate disclosure, taxpayer standing, and antitrust standing

NJ Media Group v. United States — civil — reversal — Jordan

The Third Circuit today vacated a district court order that had required disclosure of the names of the unindicted co-conspirators in the NJ Bridgegate scandal. The opinion explained, “Although the appeal arises out of a matter of high public interest, the issue presented is basic and undramatic.” The court ruled that a prosecution letter identifying the co-conspirators should be treated like criminal discovery, not a bill of particulars, and thus was not subject to public disclosure.

Joining Jordan were Ambro and Scirica. Arguing counsel were Jenny Kramer of Chadbourne & Parke for the appellant, Bruce Rosen of McCusker Anselmi for media groups seeking disclosure, and U.S. Attorney Paul Fishman for the government.

Early news coverage of the opinion by Ted Sherman on NJ.com is here.

 

Nichols v. City of Rehoboth — civil — affirmance — Fisher

A divided Third Circuit panel today held that a taxpayer lacked standing to sue because she failed to show any illegal use of taxpayer funds.

Fisher was joined by Rendell; Cowen dissented. Arguing counsel were David Finger of Finger & Slanina for the appellant and Max Walton of Connolly Gallagher for the appellees.

 

Hartig Drug Co. v. Senju Pharma. — civil / antitrust / class action — reversal — Jordan

The Third Circuit today ruled that a district court erred when it dismissed an antitrust class action suit under F.R.Civ.P. 12(b)(1) on standing grounds, holding that antitrust standing is not an issue of subject-matter jurisdiction. The appeal arose out of an antitrust suit alleging wrongful suppression of generic competition in the sale of medicated eyedrops. The winning argument was not made by the appellant, prompting the court to write, “Remarkably, Hartig neglects to address the argument at all, except to acknowledge that amici have raised it.” The opinion has some sharp words (“simply not so,” “attempt to change the discussion,” “wholly new argument”) for the appellees, too. Quite a victory for amici.

Joining Jordan were Ambro and Greenberg. Arguing counsel were Brent Landau of Hausfeld for the appellant and M. Sean Royall of Gibson Dunn for the appellee.

 

Addie v. Kjaer — civil — affirmance in part — Fisher

The Third Circuit largely upheld a district court’s rulings under Virgin Islands law granting pre- and post-judgment interest but denying attorney’s fees. The court ruled that certain prejudgment interest should have been paid at a statutory rate.

Fisher was joined by Krause and Roth. Arguing counsel were former Rendell clerk Robert Palumbos of Duane Morris for the appellants and Sherry Talton of Texas and Maria Hodge of the Virgin Islands for the appellees.

“Although we will affirm … we do so with some reluctance…. [T]he circumstances of this case appear to exemplify what can be described as a flaw in our system of justice”

Curry v. Yachera — civil rights — affirmance– Chagares

The quote that forms the title of this post comes from the introduction of today’s notable opinion upholding the dismissal of a civil rights complaint.

The court summarizes the facts underlying the suit like this (appendix cites and footnotes omitted):

In the fall of 2012, Curry read a newspaper article that stated there was an outstanding warrant for his arrest, related to a theft at a Wal-Mart store in Lower Macungie Township, Pennsylvania. Wal-Mart security employee Kerrie Fitcher identified Curry. Curry insists that he had never been in that Wal-Mart store. Curry called the Wal-Mart store and spoke to a security employee, John Doe, who refused to review the store surveillance video. Curry then called the Pennsylvania State Police and spoke to Trooper Brianne Yachera. Yachera informed Curry that he was going to jail and that the courts would “figure it out.”

On October 29, 2012, Curry was arrested and charged with (1) theft by deception and (2) conspiracy. Unable to afford bail, Curry was jailed. On November 14, 2012, while Curry was still in jail, he was charged with “theft by deception – false imprisonment” by Exeter Township Police Detective Richard McClure. This charge was separate and apparently unrelated to the charges brought by Yachera. Two months later, McClure met Curry in prison, admitted Curry was innocent of the November 14 charges, apologized, and said he would do whatever he could to help. In or about February 2013, McClure’s charges against Curry were dropped, but he remained in jail on the charges brought by Yachera. Curry was told he would need to wait until September 2013 for the case to proceed. During his imprisonment, Curry missed the birth of his child and lost his job. Curry feared losing his home and motor vehicle. He decided to plead nolo contendere to the remaining charges, theft by deception and conspiracy. Following his plea, he was released and returned home.

The court’s analysis begins with this remarkable passage (footnotes omitted):

The broader context of this matter is disturbing, as it shines a light on what has become a threat to equal justice under the law. That is, the problem of individuals posing little flight or public safety risk, who are detained in jail because they cannot afford the bail set for criminal charges that are often minor in nature. One recent report concluded that “[m]oney, or the lack thereof, is now the most important factor in determining whether someone is held in jail pretrial” and that “the majority of defendants cannot raise the money quickly or, in some cases, at all.” By way of example, in New York City in 2013, fifty-four percent of those jailed until their cases were resolved “remained in jail because they could not afford bail of $2,500 or less.” It seems anomalous that in our system of justice, the access to wealth is what often determines whether a defendant is freed or must stay in jail. Further, those unable to pay who remain in jail may not have the “luxury” of awaiting a trial on the merits of their charges; they are often forced to accept a plea deal to leave the jail environment and be freed.

“Curry’s inability to post bail,” the court observed, “deprived him not only of his freedom, but also of his ability to seek redress for the potentially unconstitutional prosecution that landed him in jail in the first place.” The court denied the malicious prosecution claim because his conviction stood. The court did rule that his malicious prosecution claims should have been dismissed without prejudice because his claim will not accrue unless and until his conviction is reversed.

Joining Chagares were Fuentes and Greenberg. The case was decided without oral argument.

 

Auto-Owners Insurance Co. v. Stevens & Ricci — insurance — affirmance — Jordan

A divided Third Circuit panel affirmed a district court ruling in favor of the insurance company in a coverage dispute.

Joining Jordan was Hardiman; Greenaway dissented, arguing that the majority misapplied a rule against aggregation. Arguing counsel were David Oppenheim from Illinois for the appellant and Timothy Tobin from Minnesota for the appellee.

 

Three new opinions, featuring two judges writing separately on substantial standing and waiver issues

Freedom From Religion Foundation v. New Kensington Arnold S.D. — civil / First Amendment —  reversal in part — Shwartz

For the past 60 years, a public high school in Pennsylvania has a had a granite monument on school grounds inscribed with the Ten Commandments. A student, a parent, and a group dedicated to the separation of church and state sued the school, alleging that the monument violated the Establishment Clause, but the district court dismissed the suit on standing and mootness grounds. Today, the Third Circuit reversed in part, holding that the parent had standing because she had direct contact with the monument and remanding to determine whether the parent was a member of the group.

Joining Shwartz were Smith and Hardiman; Smith concurred dubitante in a lengthy opinion explaining his doubt that a claim for nominal damages should suffice to confer standing or overcome mootness.

Arguing counsel were Marcus Schneider of Steele Schneider for the appellants, Anthony Sanchez for the school district, and Mayer Brown associate Charles Woodworth for amicus.

 

NLRB v. Fedex Freight — labor — petition denied — Scirica

A group of Fedex Freight drivers voted to unionize but Fedex refused to bargain with them, arguing that another group of employees had to be included, too. The NLRB ruled against Fedex and Fedex filed a petition for review. Today, a divided Third Circuit panel denied the petition for review. Apart from the merits issues, the majority and concurring opinions feature an important back-and-forth about when cursory presentation of an argument in district court will result in waiver on appeal.

Joining Scirica was Ambro; Jordan concurred in part and concurred in the judgment, explaining his view that Fedex waived one of its central arguments below by making it only in passing in a footnote. Arguing counsel were Milakshmi Rajapakse for the NLRB and Ivan Rich Jr. for Fedex.

 

US v. Stevenson — criminal — affirmance — Hardiman

The Third Circuit today affirmed a criminal defendant’s conviction and sentence, rejecting a series of challenges including his argument that the dismissal of the charges against him for a speedy-trial violation should have been with prejudice, not without. The court also held that indictment defects are subject to harmless error analysis, overruling its own prior precedent based on intervening Supreme Court precedent and splitting with the Ninth Circuit.

Joining Hardiman were Smith and Shwartz. The case was decided without argument.

New Jersey clobbered in sports-betting en banc

NCAA v. Governor — civil — affirmance — Rendell — en banc

The en banc Third Circuit today rejected New Jersey’s effort to legalize sports betting, holding that the effort violated the Professional and Amateur Sports Protection Act and that PASPA did not violate constitutional anti-commandeering principles. The en banc ruling came out the same way as the earlier panel ruling.

A couple quick observations.

First, New Jersey got pasted. They came into en banc rehearing with reason to be fairly confident about two votes (Fuentes and Vanaskie, the dissenters from Christie I and the Christie II panel), so they needed to pick up another 5 votes for an en banc majority. They picked up zero. Their position was built around business and federalism, but they failed to pick up a single Republican-nominated judge. For New Jersey and for state-sports-gambling advocates, today’s outcome was a disaster.

Second, there was some speculation last month by prominent legal experts (here and here) that the court’s slowness in issuing the opinion gave reason to think New Jersey would win. That speculation proved badly off the mark.

New Jersey reportedly will to petition for Supreme Court review, but one supporter admits it’s a “long shot.” Indeed.

New opinions — an en banc ruling in the Double Eagle gold coins case, plus an immigration case

Langbord v. US Dept. of the Treasury — civil — affirmance — Hardiman

The en banc Third Circuit ruled that the government was allowed to keep 10 extremely rare and valuable Double Eagle gold coins it seized from the family that had handed them over for authentication. Previously a divided panel (Rendell and McKee with Sloviter dissenting) had ruled for the family. It’s an unusual en banc case in that covers a dizzying list of appellate issues, many of them fact-bound.

The court split 8+1 to 3. Joining Hardiman were Ambro, Fuentes, Smith, Fisher, Chagares, Vanaskie, and Shwartz. Jordan concurred in part and concurred in the judgment, describing the Mint’s strategy of claiming the coins without judicial authorization as “a bad idea.” Rendell with McKee and Krause dissented, criticizing the majority’s reasoning as “at best cryptic and, at worst, sets an incorrect and dangerous precedent that would allow the Government to nullify CAFRA’s provisions at will.”

Arguing counsel were Barry Berke for the family and Robert Zauzmer for the government.

An interesting and odd case.

 

Sunday v. AG — immigration — petition denied — Chagares

The Third Circuit held that the Immigration and Nationality Act does not grant the Attorney General authority to grant a waiver of inadmissibility, and it held that removal cannot be unconstitutionally disproportionate punishment because it is not punishment.

Joining Chagares were Fisher and Barry. Arguing counsel were Keith Whitson of Schnader Harrison in Pittsburgh for the petitioner and Andrew Oliveira for the government.

New opinion — divided Third Circuit panel vacates career-offender criminal sentence under plain-error review

US v. Calabretta — criminal — reversal — Chagares

The Third Circuit reversed a criminal sentence under plain error review yesterday, holding that Johnson v. United States invalidates the residual clause of USSG 4B1.2 and that sentencing the defendant as a career offender was plain error.

Joining Chagares was Jordan. Fisher dissented, “specifically to address the erosion of the doctrine of plain error review in our Circuit.” Arguing counsel were John Meringolo of New York for the defendant and Steven Sanders for the government.

New opinion — divided panel reverses conviction based on failure to give entrapment defense [updated]

US v. Dennis — criminal — reversal in part — Nygaard

In a criminal appeal arising out of a stash house reverse sting, a divided panel reversed a defendant’s convictions for robbery and gun possession, holding that the district court erred in failing to instruct the jurors on entrapment, and specifically in weighing competing evidence in the government’s favor to deny the instruction. The majority also rejected the government’s harmless-error argument. It rejected the defendant’s argument that he was the victim of an outrageous prosecution violating due process.

Joining Nygaard was Hardiman; interestingly, Ambro dissented from the instruction reversal, and also expressed measured concerns about stash house reverse stings. Arguing counsel were Benjamin Yaster of Gibbons for the defendant and Mark Coyne for the government.

I expect a government petition for rehearing en banc and I’m certainly curious to see what happens.

[I updated my original post with more details.]

Divided Third Circuit panel upholds deportation based on special court-martial conviction

Gourzong v. AG — immigration — dismissal — Rendell

Under federal law, a non-citizen can be deported if he was “convicted of an aggravated felony,” and “convicted” requires a judgment of guilt “by a court.” Jamaican native Gurson Gourzong was convicted of an aggravated felony by a special court-martial. Unlike a general court-martial, a special court-martial is not necessarily presided over by a legally trained judge, and the record doesn’t clearly establish whether a legally trained judge presided over Gourzong’s special court martial.

Today, a divided Third Circuit panel held that, because “as a general matter” special courts-martial qualify as courts, therefore the special court-martial conviction here was a judgment by a “court,” and accordingly Gourzong was removable. In a footnote, the panel left open the possibility that aliens could prove their specific special courts-martial were not “courts,” but said Gourzong had made no such showing.

Judge Cowen dissented. The nub of his disagreement came down to his position that it should have been the government’s burden, not the alien’s, to establish that the specific special court-martial at issue qualified as a court. He also disagreed that the special courts-martial typically qualfied as courts, noting that the presiding officers lack military judges’ training and independence. And he criticized the government’s conduct in the case, noting its history of changing its position and its failure to timely file its brief.

Joining Rendell was Fisher; Cowen dissented. Arguing counsel were Craig Shagin of the Shagin Law Group for the petitioner and Jesse Bless for the government. The panel thanked Shagin for agreeing to serve as pro bono counsel for his “excellent advocacy” in the case, and Cowen  praised Shagin as “Gourzong’s able pro bono counsel.”

[As the circuit’s resident typography scold, I register my horror that the majority opinion put its record cites in boldface. My horror is mitigated only partially by the opinion’s use of hard spaces after section symbols.]

New opinion — court rules for pornography producers in challenge to records laws

Free Speech Coalition v. AG — civil — vacatur — Smith

A divided Third Circuit panel today ruled in favor of pornography-industry plaintiffs challenging federal laws requiring them to maintain and allow inspection of certain records. The majority ruled that the statutes and regulations were content based and thus subject to scrutiny under the First Amendment. It further held that the inspection provisions facially violated the Fourth Amendment. Dissenting on the First Amendment issue, Judge Rendell argued strict scrutiny should not apply. This case was before the court for the third time; I discussed the previous round here.

Joining Smith was Scirica, with Rendell dissenting. Arguing counsel were J. Michael Murray for the plaintiffs and Anne Murphy for the government.

An interesting divided-panel employment-discrimination case that’s unpublished

I rarely blog about the Third Circuit’s non-published opinions, but the court issued one today which readers may find interesting. The case is Young v. City of Philadelphia Police Dept.

The appeal arises from a Title VII retaliation suit brought by a woman against the Philadelphia Police. The gist of her complaint is that, after she filed a sexual-harassment complaint against a fellow police trainee, the department retaliated by commencing a campaign of disciplinary write-ups for minor violations that she’d never been punished for before her complaint.

Title VII retaliation claims proceed in 3 stages: (1) the plaintiff must make a prima facie case of retaliation, (2) the employer must provide a legitimate non-discriminatory reason for its adverse employment action, and (3) the plaintiff must prove that the proffered explanation was pretextual and retaliation was the real motive. Here the district court granted summary judgment in favor of the employer. It ruled that the plaintiff failed at the first, prima facie stage because she did not show that retaliation was the  but-for cause for her discipline.

All three members of the Third Circuit panel agreed that the district court was wrong to require but-for causation at the first, prima facie stage. The majority opinion observed that the district court’s error was understandable “[b]ecause we have not stated in a precedential opinion that ‘but for’ caustion is not required at the prima facie stage of summary judgment analysis.”

The panel majority (Shwartz joined by Greenaway) affirmed anyway, ruling that the plaintiff failed to carry her burden at the the third, pretext stage. Vanaskie dissented because he believed the plaintiff’s pretext showing created a material issue of fact sufficient to survive summary judgment.

I have a few thoughts:

First, the opinion says the district court was wrong to require but-for causation at the prima facie stage, and it expressly acknowledges that no prior precedential opinion so holds. So why the heck is this opinion unpublished?

Second, the fact that there’s a dissent on the pretext issue adds a least a little to my surprise that it’s unpublished. While there’s certainly no rule that says that divided-panel opinions have to be published, they often are.

Third, the way the panel split here is interesting. I consider Vanaskie to be generally more conservative than Greenaway or Shwartz (see, for example, his recent en banc voting record), but most would consider his position here (favoring an employment-discrimination plaintiff) more liberal.

Finally, on a first read I found Vanaskie’s dissent pretty persuasive. But I’d be surprised if the votes are there for en banc rehearing.

Anyway, interesting case, and happy Friday.

A rare dissent from denial of rehearing en banc

Easy to miss among the unpublished opinions issued today was an order denying rehearing en banc in United States v. Kelly. The panel opinion, also unpublished, is here. It was authored by Greenaway and joined by Scirica and Roth.

Here’s the interesting part: four judges (McKee, joined by Ambro, Smith, and Restrepo) dissented from the denial of rehearing. Any dissent from denial of rehearing is quite rare in the Third Circuit. It’s rarer still given that the panel opinion was both unpublished and unanimous, and that none of the dissenters sat on the panel.

The heart of the issue is how jurors are instructed in drug-conspiracy cases, specifically whether those instructions unjustly expose mere purchasers to criminal liability as conspirators. McKee’s opinion explains his basis for dissenting in this introduction:

I appreciate that the panel’s decision in this case was
dictated by circuit precedent and that my colleagues therefore
felt compelled to affirm the jury’s determination that Kelly’s
membership in the Alford drug distribution conspiracy had
been proven beyond a reasonable doubt. However, I take the
unusual step of filing this opinion sur denial of rehearing to
explain why we have made a mistake by not availing
ourselves of this opportunity to reexamine our jury
instructions in drug conspiracies. I do so even though this
appeal has been resolved in a non-precedential opinion
because our current approach to informing jurors how to
distinguish between a purchaser from a drug conspiracy and a
member of that conspiracy is so meaningless that it presents
the illusion of an objective standard while furnishing no
guidance to jurors who must make this crucial distinction.

Our current standard for channeling a jury’s inquiry in
such prosecutions fails to provide a jury with sufficient
guidance to allow jurors to appropriately differentiate
between customers and co-conspirators. Although some of
our factors may be relevant to this inquiry, the irrelevant
factors I discuss below create the very real danger of placing
a thumb on the conspiratorial side of the scale and thereby
tipping the balance in favor of a conviction for conspiracy
when only a buyer-seller relationship has been established.
Because there is no way of knowing how this jury would have
viewed the circumstantial evidence against Kelly if that
additional weight had not been added to the conspiratorial
side of the scale, I believe this case “involves a question of
exceptional importance,” meriting en banc reconsideration.
Fed. R. App. P. 35(a).

He concludes thus:

Given the extent to which illegal drugs and illegal drug
sales continue to devastate and destroy lives and
communities, I have no doubt that we will have another
opportunity to revisit the factors we use in attempting to
distinguish between purchasers and co-conspirators.
Regrettably, in the interim we also will no doubt expose
numerous purchasers of drugs (even those who purchase
merely to “feed” their own addiction) to the exponentially
greater penalties that attach to being a member of a drug
conspiracy. I therefore take this opportunity to express my
concern that we are failing to afford jurors the guidance they
need and that the law requires in deciding whether evidence is
sufficient to establish guilt beyond a reasonable doubt in
cases such as this. Worse yet, the “guidance” that we do give
jurors is not only less than helpful, it is misleading because it
can be an open invitation to convict mere purchasers of illegal
drugs of the far more serious crime of being a member of a
drug conspiracy. Accordingly, I now echo the concern
expressed by Judge Becker a decade and a half ago and
explain why we should avail ourselves of this opportunity and
grant Kelly’s petition for rehearing.

Thirteen judges participated in the en banc rehearing decision, so the dissenters apparently fell three votes short, with five judges appointed by Democratic presidents not dissenting.

(I say “apparently” because nothing requires a judge who voted in favor of rehearing en banc to dissent from the denial. So it’s theoretically possible that one or two judges voted to grant rehearing but declined to join McKee’s dissent or issue their own.)

Two new opinions — a big telecom case and a little criminal-sentencing case

Stirk Holdings v. FCC — agency / telecom — vacate and remand — Ambro

Here is the remarkable introduction to Judge Ambro’s remarkable opinion today scolding the FCC:

Twelve years have passed since we first took up challenges to the broadcast ownership rules and diversity initiatives of the Federal Communications Commission (“FCC” or “Commission”). In some respects the Commission has made progress in the intervening years. In key areas, however, it has fallen short. These shortcomings are at the center of this dispute—the third (and likely not the last) round in a protracted battle over the future of the nation’s broadcast industry. Specifically, the parties present challenges to the Commission’s “eligible entity” definition, its Quadrennial Review process, and its rule on television joint sales agreements.
Although courts owe deference to agencies, we also recognize that, “[a]t some point, we must lean forward from the bench to let an agency know, in no uncertain terms, that enough is enough.” Public Citizen Health Research Group v. Chao, 314 F.3d 143, 158 (3d Cir. 2002) (emphasis and internal quotation marks omitted). For the Commission’s stalled efforts to promote diversity in the broadcast industry, that time has come. We conclude that the FCC has unreasonably delayed action on its definition of an “eligible entity”—a term it has attempted to use as a lynchpin for initiatives to promote minority and female broadcast ownership—and we remand with an order for it to act promptly.

Equally troubling is that nearly a decade has passed since the Commission last completed a review of its broadcast ownership rules. These rules lay the groundwork for how the broadcast industry operates and have major implications for television, radio, and newspaper organizations. Although federal law commands the Commission to conduct a review of its rules every four years, the 2006 cycle is the last one it has finished; the 2010 and 2014 reviews remain open. Several broadcast owners have petitioned us to wipe all the rules off the books in response to this delay—creating, in effect, complete deregulation in the industry. This is the administrative law equivalent of burning down the house to roast the pig, and we decline to order it. However, we note that this remedy, while extreme, might be justified in the future if the Commission does not act quickly to carry out its legislative mandate.

Whereas the first two issues before us involve agency delay, the third is a challenge to agency action. The Commission regulates the number of television stations a company can own. In 2014, it determined that parties were evading its ownership limits through the influence exerted by advertising contracts known as joint sales agreements. As a result, it created a rule designed to address this perceived problem. However, we conclude that the Commission improperly enacted the rule; hence we vacate it and remand the matter to the Commission.

Ambro was joined by Fuentes; Scirica dissented in part because he would have gone further and ordered the FCC to issue its 2010 quadrennial review within 6 months. Arguing counsel were David Gossett for the FCC, and Helgi Walker of Gibson Dunn, Patrick Philbin of Kirkland & Ellis, and Georgetown Law professor Angela Campbell for various petitioners/intervenors.

 

United States v. Nerius — criminal sentencing — affirmance — Shwartz

Jean Nerius was convicted of two crimes. He was classified as a career offender at sentencing, resulting in a sentencing guidelines range of 37 to 46 months. Although his pre-sentencing prison-discipline record was bad, the judge sentenced him at the bottom of that range, 37 months. But the career-offender designation was error, so Nerius was resentenced. This time his guideline range was 30 to 37 months. And since his original sentencing his disciplinary record had been spotless. But this time the sentencing judge sentenced him to 36 months, near to top end of the guideline range and just one month less he’d gotten than when he was deemed a career offender.

On appeal, Nerius argued that his new sentence was presumptively vindictive — that the sentencing judge should be presumed to have punished him for winning his first appeal by going from a bottom-of-the-old-range sentence to an-almost-top-of-the-new-range sentence, when the only thing that had apparently changed since the first sentencing (besides the fact that he was no longer deemed a career offender) was that he’d been a model prisoner for the past two years.

Today, the Third Circuit rejected Nerius’s argument and affirmed his sentence. The panel said that no presumption of vindictiveness applies because the new sentence was shorter than the old one, period. The fact that the sentence went from the bottom of the guideline range to near the top, with no intervening bad acts, did not trigger the presumption.

If you believe that sentencing judges put much stock in guidelines ranges and career-offender designations, you’re more likely to think this ruling is unjust. If you don’t, well, you probably don’t. In that vein, it’s interesting that the panel consisted of two former district judges and one former magistrate judge.

Joining Shwartz was Smith and Hardiman. The case was decided without oral argument.

A divided panel applies civil rules strictly to dismiss an appeal as untimely

State National Insurance v. County of Camden — civil — dismissal — Fisher

A divided Third Circuit panel today held that it lacked jurisdiction to hear an appeal because the appeal was untimely. It’s an interesting case both factually and legally.

The appeal was brought from dismissal of a legal malpractice suit. The legal malpractice suit, in turn, arose from a civil suit. A person injured in a car crash sued Camden County alleging negligent maintenance. The county had an insurance policy with a $10 million limit. The lawyer who represented the county allegedly told the insurance company (belatedly) that the case was meritless and she valued it at $50,000. But after a trial the jury awarded the victim $31 million, later remitted to $19 million. Four days later, the insurer sued the county and the attorney. (Actually, the former attorney — her Linkedin page states that she took “a very early retirement,” moved to another state, and became a realtor.)

Now here’s where things get tangled procedurally. The insurer’s original complaint against the lawyer — one of the 2 defendants — was dismissed in 2010. The insurer filed a motion to reconsider that ruling under Rule 59(e), and also a motion to certify an immediate appeal under Rule 54(b), both of which were denied. For the next four years, the insurer litigated its claims against the other defendant, the county. The district court eventually denied the insurer’s motion for summary judgment. The insurer believed that this denial undermined the basis for the earlier dismissal of the claims against the lawyer, so it sought to reinstate those claims under Rule 60(b)(6), and the court ordered briefing on the motion. While motion to reinstate the claims against the lawyer was pending, the insurer and the county settled the claims against the county, The joint stipulation of dismissal between the insurer and the county recited that the insurer wanted to renew its claims against the lawyer. The district court then denied the motion to reinstate the claims against the lawyer, and 15 days later the insurer filed a notice of appeal from the denial of the motion to reinstate the claims against the lawyer. FRAP 4 provides 30 days to file a notice of appeal after entry of judgment or the order appealed from.

The appeal turned on whether the insurer’s appeal involving its claims against the lawyer was timely, and the panel split. The majority (Fisher joined by Chagares) held that the appeal was untimely. Rule 60(b)(6) gives district courts authority to undo final judgments, it explained, and at the time when the insurer filed its 60(b)(6) motion the judgment was not final because the claims against the county remained pending. Thus Rule 60(b)(6) “was not a proper avenue by which to challenge” dismissal of the claims against the lawyer, and as a result the majority treated it as a nullity. And, while district courts also have inherent power to reconsider prior interlocutory orders, that power ends when the court loses jurisdiction, which the majority held happened when it entered a voluntary stipulation of dismissal of the claims against the county, even though no entry of judgment resulted from that. And because the 60(b)(6) motion was “not a proper Rule 60(b) motion,” the majority ruled that it could not toll the appeal-filing deadline under FRAP 4(a)(4)(A). The majority acknowledged that its ruling was “strict.”

Judge Jordan dissented, beginning:

The Majority acknowledges that its interpretation of the operative rules of procedure is “strict.” But the interpretation goes beyond strict: with all respect, it is wrong.

He reasoned:

As the Majority would have it, State National could only maintain its appeal rights by choosing between two bad alternatives: it could abandon its settlement of its separate claim against the County, or it could appeal the dismissal of the claims against Whiteside even as the District Court was actively reconsidering that dismissal. The federal rules of civil procedure and of appellate procedure are meant to permit the “just, speedy, and inexpensive determination of every action and proceeding,” Fed. R. Civ. P. 1, and to allow district courts to fully resolve all issues in the first instance so that appellate review is not “piecemeal,” Eisen v. Carlisle & Jacquelin, 417 U.S. 156, 170 (1974). It would therefore be strange if the rules really did put State National in that bind.

In Jordan’s view, the insurer’s Rule 60 motion to reinstate the claims against the lawyer kept those claims open until the court ruled on the motion. He disagreed that the district court lost its power to reinstate the claims against the lawyer when the claims against the county were voluntarily dismissed, and also disagreed that the Rule 60(b) motion was a nullity because it was filed before the voluntary dismissal. In a footnote, he noted that the majority “are abolishing Rule 60(b) relief for parties in [the insurer’s] position” because any motion would be too early, too late, or, as here, both.

I’m betting the farm that the insurer will seek rehearing en banc, and rare though en banc rehearing is, I think such a motion has a realistic chance of being granted here. On first reading, I find the dissent’s analysis more persuasive. It’s one of the strongest Third Circuit dissents I’ve seen in recent years.

As noted, Fisher was joined by Chagares and Jordan dissented. Arguing counsel were Walter Andrews of Hunton & Williams for the insurer and Michael Canning and Matthew Fiorovanti of Giordano Halleran for the appellee.

 

New opinion — ‘interesting tax-accounting appeal’ is not an oxymoron, apparently

Giant Eagle v. Commissioner — tax — reversal — Roth

A supermarket offered its customers a discount on gas purchases: for every $50 spent on groceries, they got 10 cents off a future gas purchase. Naturally, at the end of the tax year, there were customers who had earned a gas discount but had not yet redeemed it. In its taxes, the supermarket claimed those earned-but-not-yet-redeemed discounts as deductions, reducing the total amount outstanding by past redemption rates. The IRS and the tax court disallowed the deductions, but today a divided Third Circuit reversed, ruling in the supermarket’s favor.

Joining Roth was Fisher; Hardiman dissented. Both opinions are excellent. Arguing counsel were Robert Barnes of Marcus & Shapira for the supermarket and Julie Avetta (who had quite a wedding announcement) for the government.

New opinion — divided Third Circuit panel upholds black lung statute-of-limitations ruling

Eighty Four Mining v. Director, Office of Workers’ Compensation Progs. — agency — affirmance — Vanaskie

After a board of the Labor Department awarded black lung benefits to a coal miner, the mining company argued that miner’s claim was untimely because a state board’s denial of state benefits should not restart the federal clock. The Third Circuit today disagreed with the company, denied the petition for review, and affirmed.

Joining Vanaskie was Rendell; Nygaard dissented. Arguing counsel were Norman Coliane of Thompson Calkins for the mining company, Heath Long of Pawlowski Bilonick for the miner, and Helen Cox for the government.